Summary

In 2012 Alex Salmond gave a lecture entitled ‘Scotland’s Place in the World’. With characteristic narrative flair, the former SNP leader sought to position Scotland’s ambitious 2009 Climate Change Act as a pivotal moment in the story of devolution: ‘a parliament trusted with the big issues can rise spectacularly to the occasion,’ he noted. Throughout his term as First Minister, Salmond would frequently riff on the economic and job creating capacity of Scotland as a green energy powerhouse, or the ‘Saudi Arabia of renewable power.’

The thread of that narrative is wearing thin. But there is still substantial emphasis on responding to the climate crisis within the SNP’s governing agenda. In addition to a new Climate Change Bill, the current administration is committed to a clutch of policies that have the potential to support a Green New Deal. These include a Scottish National Investment Bank, a publicly owned energy company and, in a global first, the Just Transition Commission, made up of 11 independent advisors tasked with informing all areas of government on how best to manage the shift to a low-carbon economy.

However, despite Nicola Sturgeon’s commitment to delivering a ‘Scottish Green Deal,’ made at the 2019 Scottish Trades Union Congress (STUC) has failed to realise profound wider social benefits commonly associated with the Green New Deal proposition in the UK or USA.

The current ambiguity about the equity of the story so far must also be considered alongside an emerging consensus that the next steps in decarbonisation in Scotland are likely to be inherently more challenging. With ministers in Edinburgh currently considering a new Climate Bill in the light of Nicola Sturgeon’s declaration of a ‘climate emergency’ at the SNP’s 2019 Spring Conference, the Committee on Climate Change has pointed out that progress in the power sector is masking a lack of action in other areas. The most obvious steps, such as closing Scotland’s last coal fired power station, have already been taken. The next phase of transition: focused on transport, agriculture, and housing, is likely to be far more politically challenging, complex and costly.

The politicisation of devolution

In April 2019, the Scottish Government’s Cabinet Secretary for Environment, Climate Change and Land Reform Roseanna Cunningham stated: ‘We are already a recognised world leader with our climate change ambitions and we intend to maintain that level of ambition,’ while adding the caveat that a Green New Deal could only be effectively delivered with the full powers of independence. At a moment when an ongoing UK-wide constitutional crisis is amplifying the debate around Scotland’s future, it is important to consider how the next stages of decarbonisation will be delivered, and what immediate changes can be brought about to facilitate this.

Consistently higher levels of public spending per capita in Scotland have created a political fissure around the mechanics of devolution. In an era of austerity it became imperative to shape the devolution settlement so that higher public spending north of the border was seen to result in a bigger personal tax burden. This essentially hostile view, which framed the 2016 Scotland Act, ignores other factors that influence public spending in Scotland. These include a substantially lower population density, a particularly intense experience of deindustrialisation, and distinct institutional and civic cultures. All of these characteristics have to be factored in to any discussion about how a Green New Deal might be implemented north of the border.

While the twin polarity between the politics of tax and spend and the politics of nationalism and unionism may only find an adequate solution once the constitutional question is resolved, it is not beyond the realms of possibility to suppose that an issue as fundamental as the climate crisis could act as a catalyst to break this cycle.

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The oil and gas consensus

With the exception of the Scottish Green Party, who propose a public stake in existing oil and gas assets, there has been a general failure to propose specific policies to manage a drawdown of the oil and gas sector in a manner that would align with the priorities of a Green New Deal.

The UK Government has consistently pursued light touch regulation in the North Sea: arguably a product of the sector emerging in a symbiotic relationship with the City under Thatcherism. The latest iteration of this trend, the policy of Maximum Economic Recovery, seeks to maintain the presence of operators offshore for as long as is feasibly possible, using the mechanism of tax breaks (worth over £24bn) tied to decommissioning of a multitude of ageing platforms and pipelines. There has been little interest from officials in either London or Edinburgh in using this form of public funding to promote a just transition programme: for both sets of politicians the profitability of companies operating in the North Sea remains paramount.

Despite a wide range of employment opportunities stemming from the decommissioning of ageing offshore infrastructure, there is a lack of a coherent strategy to ensure that this industry within an industry, worth up to £50bn, forms part of a programme to retain skills and jobs in Scotland, often in roles that could feasibly transfer into sectors like offshore wind. In 2018 direct and indirect employment in oil and gas stood at 282,700, compared to 463,900 in 2014. Worried about further shocks impacting on the Scottish economy, the SNP support a policy of Maximum Economic Recovery, and have consistently called for tax breaks to be maintained. As with the nation’s only crude oil refinery at Grangemouth (owned by INEOS and Petrochina) there is a strong political imperative for the SNP to accept the status quo in order to maintain the output of such a high-value industry regardless of its implications for the climate. The party’s focus has therefore been to bracket alternative macro policy levers, such as some form of sovereign wealth fund, within their future prospectus for a new Scottish state.

Energy and job failures

The renewable sector has grown threefold since 2008 and now stands at 10GW of capacity: generating 68% of gross electricity consumption in Scotland in 2017. Yet current deployment is dwarfed by future opportunity. Offshore wind in particular (Scotland claims 25% of Europe’s overall potential) has become recognised as the most significant player in the next phase of Scotland’s energy transition.

However, particularly in supply chains and manufacturing, job numbers in renewables have not lived up to early forecasts, and have even declined over the past two years. A report by the STUC found that the Scottish Government’s emphasis on low-carbon inward investment lacked ‘requisite focus on socio-economic benefit for workers and communities’. A sector defined by foreign ownership of generation assets and the over-reliance on foreign direct investment seems unlikely to provide a just transition for Scotland.

Large private operators in the offshore wind sector have also been found to be employing non EEA workers on less than the minimum wage. This practice, which is common in oil and gas sector too, has been branded ‘social dumping’ by offshore unions. Further intervention — through the creation of a publicly owned generating company, better use of the planning system in Scotland, and closer regulation of offshore working practices and licensing at a UK level — will be required to address these issues.

A Scottish National Energy Company

In 2017 the SNP committed to creating a not-for-profit publicly owned energy company, with the aim of tackling endemic fuel poverty: currently affecting around 1 in 5 Scottish households, with far higher rates in rural areas. It is anticipated that the venture will be modelled on existing white label providers such as Nottingham’s Robin Hood Energy.

Despite strong critiques from various quarters about the limitations of pursuing such a minimalist model, there is little evidence that Scottish civil servants will establish the company on a footing that would allow it to go further and invest directly in energy generation or distribution networks.

Beyond a lost opportunity to create jobs through establishing a public stake in generation assets, in line with a Green New Deal programme, the minimalist approach also risks exacerbating one of the biggest challenges Scotland faces when it comes to decarbonisation: heating. There is little incentive for private sector operators to invest in low return projects, such as district heating schemes, that would assist Scotland to achieve its ambitious target of low carbon heat for 45% of domestic and non-domestic buildings by 2032. There is also a lack of public direction, strategy and data sharing within the energy sector at a Scottish level: hindering the pursuit of a joined up approach to renewables, heat, energy efficiency and community energy schemes.

Even with greater public involvement in low-carbon energy and heating, new grid connections in peripheral areas have been hobbled by the competitive process of the UK Government’s Contracts for Difference licensing scheme, alongside the abandonment of Feed in Tariffs. This problem is compounded by OFGEM’s prioritisation of delivering value to the consumer and security of supply. This has been seen to privilege large scale projects over more localised schemes and has resulted in painfully slow progress to upgrade rural grid connections. In Orkney, the preeminent global testbed for marine renewables, there has been a prolonged battle for improved grid connectivity. The islands currently produce around 120% of their electricity from renewable sources, face exorbitant transmission charges to export it south, and often have to turn off community-owned generation assets due to a lack of grid capacity.

This chronic disempowerment clearly requires reform of the energy market at a UK level, in addition to the restructuring of the grid to better enable generation in peripheral, renewable-energy-rich areas. In the meantime, clearer strategic direction - whether in the form of an explicit industrial strategy, or simply a reappraisal of the Scottish Government’s long standing reluctance to ‘pick winners’ in the renewables sector, would go some way to boost investment. More prosaically, there is also a need to better staff and resource Scottish Government units working in areas related to transition: a factor that has fed into calls for a Scottish National Energy Development Agency, modelled on the Danish Energy Agency, with a broad remit and powers.

In 2017 the SNP committed to creating a not-for-profit publicly owned energy company, with the aim of tackling endemic fuel poverty: currently affecting around 1 in 5 Scottish households, with far higher rates in rural areas. It is anticipated that the venture will be modelled on existing white label providers such as Nottingham’s Robin Hood Energy.

Despite strong critiques from various quarters about the limitations of pursuing such a minimalist model, there is little evidence that Scottish civil servants will establish the company on a footing that would allow it to go further and invest directly in energy generation or distribution networks.

Beyond a lost opportunity to create jobs through establishing a public stake in generation assets, in line with a Green New Deal programme, the minimalist approach also risks exacerbating one of the biggest challenges Scotland faces when it comes to decarbonisation: heating. There is little incentive for private sector operators to invest in low return projects, such as district heating schemes, that would assist Scotland to achieve its ambitious target of low carbon heat for 45% of domestic and non-domestic buildings by 2032. There is also a lack of public direction, strategy and data sharing within the energy sector at a Scottish level: hindering the pursuit of a joined up approach to renewables, heat, energy efficiency and community energy schemes.

Even with greater public involvement in low-carbon energy and heating, new grid connections in peripheral areas have been hobbled by the competitive process of the UK Government’s Contracts for Difference licensing scheme, alongside the abandonment of Feed in Tariffs. This problem is compounded by OFGEM’s prioritisation of delivering value to the consumer and security of supply. This has been seen to privilege large scale projects over more localised schemes and has resulted in painfully slow progress to upgrade rural grid connections. In Orkney, the preeminent global testbed for marine renewables, there has been a prolonged battle for improved grid connectivity. The islands currently produce around 120% of their electricity from renewable sources, face exorbitant transmission charges to export it south, and often have to turn off community-owned generation assets due to a lack of grid capacity.

This chronic disempowerment clearly requires reform of the energy market at a UK level, in addition to the restructuring of the grid to better enable generation in peripheral, renewable-energy-rich areas. In the meantime, clearer strategic direction - whether in the form of an explicit industrial strategy, or simply a reappraisal of the Scottish Government’s long standing reluctance to ‘pick winners’ in the renewables sector, would go some way to boost investment. More prosaically, there is also a need to better staff and resource Scottish Government units working in areas related to transition: a factor that has fed into calls for a Scottish National Energy Development Agency, modelled on the Danish Energy Agency, with a broad remit and powers.

Infrastructure and Spending

With limited borrowing powers, and a budget that is ultimately determined via the Barnett Formula by the rest of the UK, bold additional spending commitments can be easily shirked by devolved administrations. Furthermore, it would flatly contradict Green New Deal principles for the Scottish Government’s universal provision of free prescriptions, tuition fees, and bus travel and personal care for the elderly, to be curtailed by a drive to decarbonise.

However challenging the status quo might be, there is still more that can be done within the current devolution settlement. Robert Pollin’s annual price tag for a Green New Deal, at 1.5-2% of global GDP, translated into a Scottish context, comes in at just under the level of Scottish Government’s capital expenditure in its 2019-20 budget of £5bn.

However, to date there has been a consistent failure to put decarbonisation at the heart of devolved capital expenditure. Numerous road building projects over the past decade have soaked up billions of spending, while the current pipeline includes roughly £1bn across five road improvement projects. This record has embedded issues around emissions and transport, a sector of the Scottish economy that has seen a tangible increase in emissions over the period 2011-16.

While lower carbon infrastructure programmes have also formed part of the mix, including the rail electrification and station refurbishment projects in the Edinburgh Glasgow Improvement Plan (£858m), to date there has been a lack of overarching focus to prioritise transition away from carbon when it comes to what the state chooses to build in Scotland. Fresh plans to place greater emphasis on a network of electric vehicle charging points, and the creation of a new Infrastructure Commission for Scotland, could represent an overdue shift towards a low-carbon strategy.

The new Scottish National Investment Bank, which will commence operations later this year, has been heralded as a significant tool in this regard. As outlined in a report carried out on behalf of the Scottish Government by the Institute for Innovation and Public Purpose, the new bank will have a mission-oriented framework, focused on addressing societal challenges such as transition. With £2bn earmarked for investment over a decade, Nicola Sturgeon has asserted that this new entity will be ‘a cornerstone of the high-innovation, low-carbon economy.’ Yet there is currently no plan to include a commitment on the face of enacting legislation to guarantee low carbon investment will be part of the bank’s DNA. Missions will be set at the discretion of ministers and thus subject to changing political priorities. Furthermore, technical issues around the Treasury’s relationship with the new institution, in addition to the bank’s commercial focus and inability to lend to local authorities, has cast doubt over how impactful this new institution will be in implementing a just transition.

Public ownership and nationhood

On a fundamental level, a Green New Deal requires a new federal settlement to be implemented in full across the nations and regions of the UK, however elusive that has proved to be to date. Geography and the politics of place will be fundamental to this transformation. As Andreas Malm has argued: renewables, unlike carbon assets, are fixed in time and space, making their development and ownership inherently unappealing to a global financial system in which the average stock is owned for a mere twenty-two seconds.

In a UK context then, the paradigm shift required for transition necessitates a march away from both the top-down postwar model of centralised carbon based generation, with an equally strong reversal of the radical neoliberal sell off of public assets that succeeded it. 

This new cheap, clean, decentralised model of powering the economy can only be successful if it is mirrored by a systematic decentralisation of political power. If Scotland’s green energy riches are to be tapped to the full, we must learn the political lessons of North Sea oil: in particular, its potent ability to fuel narratives of disempowerment and alienation, precisely because it came on stream in a rapidly desindustrialisimg nation. If Scotland is to become a net exporter of clean power to the rest of the UK, or to mainland Europe via a European super-grid, the benefits of these macroeconomic changes must be made tangible in Scotland in the first instance. At the same time, in order to allow communities to buy into this transition, local accountability and decision making within Scotland will have to be overhauled to enable more rapid development of low-return projects, such as district heating or small-scale renewable generation. In addition to rediscovering and rethinking models of public ownership, a Green New Deal requires a politics bold enough to confront the historic reluctance of UK power structures to embrace subsidiarity and genuine local democracy.

Furthermore, transitions will need be shaped in order to take account of widely divergent circumstances across the UK. A pertinent example here is the pattern of extremely concentrated land ownership in Scotland, an issue of systemic injustice built up over centuries. In WWF Scotland’s briefing on the Climate Change Bill, the nation is said to be ‘laden with natural advantages for net zero,’ with vast opportunities to create carbon sinks through peatland restoration, forestry and rewilding. Yet at present, one fifth of Scotland’s land is devoted to the sport of shooting grouse. As Revive, the Coalition for Grouse Moor Reform found, these vast sporting estates require 330 hectares to create a single job, in contrast to forestry, which currently occupies the same amount of land in Scotland but requires only 42 hectares per job.

Precedents from beyond the devolution era are necessary to comprehend the scale of transformation represented by a Green New Deal. The role of the state and development bodies in post-war Scotland, although not the result of a single programme, encompassed enormous changes in Scottish life. This extended to the creation of new industries, new towns, and the FDR-inspired North of Scotland Hydro-Electric Board. These changes were delivered in a manner that was both distinctly Scottish and a direct response to the global crises of the 1930s. The demands of a Green New Deal in a nation hollowed out by decades of neoliberal orthodoxy are of a similar order of magnitude.

Reflecting on his upbringing in post-war Scotland BBC journalist Alan Little argued that the decline of nationalised industry in Scotland resulted in the impoverishment of countless communities that were once ‘bedrocks of British identity.’ The failure of successive generations of British politicians to acknowledge this often obscures the fact that nostalgia for the post-war settlement is a significant reference point within Scottish nationalist narratives. The rhetorical framing of a Green New Deal has the potential to tap into this latent identification of Scotland as an industrial society: despite all the ways in which this jars with recent Scottish experience, not least the essentially neoliberal institutional cultures of devolved government.

In the meantime, the SNP are increasingly pursuing an independence prospectus that prioritises deficit reduction and market confidence during the transition to a new state. Inevitably, this has raised doubts about how credible it would be for that state to simultaneously manage the additional challenge of rapid decarbonisation, without imposing cuts elsewhere.

Only systematic transformative policies can guarantee the success of the next steps in Scotland’s journey away from a carbon-based economy. Although driven by a deep necessity, a politics that has the confidence to grasp this challenge will also inherit the opportunity to build a new bedrock of identity, in a nation with a political imagination still defined by the loss of British social democracy. 

See footnotes

[1] Alex Salmond, “Alex Salmond’s Hugo Young Lecture - full text,” Guardian, 25 January, 2012, https://www.theguardian.com/politics/2012/jan/25/alex-salmond-hugoyoung-lecture.

[2] Douglas Fraser, “The Scottish Economy, the SNP and the Absence of Economic Nationalism” in A Nation Changed? The SNP and Scotland Ten Years On, ed. Gerry Hassan and Simon Barrow (Edinburgh: Luath, 2017), 76.

[3] gov.scot, “Just Transition Commission,” Scottish Government, accessed 14 May 2019, https://www.gov.scot/groups/just-transition- commission/.

[4] gov.scot, First Minister, “Scottish Trades Union Congress: First Minister's speech,” Scottish Government, 17 April, 2019, https://www.gov.scot/publications/stuc-firstministers-speech/ .

[5] Committee on Climate Change, “Reducing emissions in Scotland, 2018 Progress Report to Parliament”, September 2018, https://www.theccc.org.uk/wp-content/uploads/2018/09/Reducing-emissions-in-Scotland-2018-Progress-Report-to-Parliament.pdf, 7-8.

[6] Scottish Parliament Official Report,24 April, 2019, http://www.parliament.scot/parliamentarybusiness/report.aspx-?r=12053&mode=pdf, 83.

[7] Matthew Keep, Scotland: Public Spending and Revenue, House of Commons Library, 26 September, 2018, No: 06625.

[8] Adam Tomkins, “The Scotland Bill implements and improves upon the Smith Commission recommendations,” Democratic Audit, 01 June, 2015, http://www.democraticaudit.com/2015/06/01/the-scotland-bill-implements-and-improves-upon-the-smith-commissionrecommendations/.

[10] See Christopher Harvie, Fool’s Gold: The Story of North Sea Oil, London: Penguin, 1995.

[11] Nathalie Thomas, “Taxpayers likely to pay £24bn for scrapping oil rigs,” Financial Times, 25 January, 2019, https://www.ft.com/content/8670e752-1fe7-11e9-b126-46fc3ad87c65.

[12] Mika Minio-Paluello, Jobs in Scotland’s New Economy, Scottish Green Party, August, 2015, https://greens.scot/sites/default/files/Policy/Jobs_in_Scotland_New_Economy.pdf.

[13] oilandgasuk.cld.bz, accessed June 2019, Oil and Gas Uk Ltd, UK, Workforce Report 2018, https://oilandgasuk.cld.bz/Workforce-Report-2018/10/, 10.

[14] scottishrenewables.com, Scottish Renewables, accessed June, 2019, “Renewables in Numbers,”https://www.scottishrenewables.com/forums/renewables-in-numbers/.

[15] Scottish Government, “Sectoral

Marine Plan for Offshore Wind Energy (encompassing Deep Water Plan Options)”, June 2018, https://www.gov.scot/binaries/content/documents/govscot/publications/consultation-paper/2018/06/sectoral-marine-plan-offshore-wind-energy-encompassing-deep-water-plan/documents/00536630-pdf/00536630-pdf/govscot%3Adocument/00536630.pdf.

[16] GMB Union accessed June 2019, STUC, "Broken Promises and Offshored Jobs", 17 April, 2019, https://www.gmb.org.uk/sites/default/files/Broken%20promises%20and%20offshored%20jobs%20report.pdf.

[17] STUC, 10.

[18]Nautilus International, accessed June 2019, “Unions condemn 'social dumping' in the offshore sector,” Nautilus International, 5 February, 2019 https://www.nautilusint.org/en/news-insight/news/unions-condemn-social-dumping-in-the-offshore-sector/.

[19] Greig Liddell, Scottish Parliament Information Centre Briefing: Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill, 03 September, 2018, https://sp-bpr-en-prod-cdnep.azureedge.net/published/2018/9/3/Fuel-Poverty--Target--Definition-and-Strategy---Scotland--Bill/SB%2018-52.pdf, 3.

[20] CCC, 21.

[21] Keith Baker, Gordon Morgan, Ron Mould & Iain Wright, “Powering Our Ambitions: The role of Scotland’s National Energy Company and the Case for a Scottish Energy Development Agency” Common Weal, February 2019.

[22] Laura Watts, Energy at the End of the World, An Orkney Islands Saga, (London:MIT Press, 2018), 27-28

[23] Christopher Silver, “Orkney: The 'Energy Islands' Penalised for Becoming Too Clean, Too Soon,” DeSmog UK, 10 March 2019, https://www.desmog.co.uk/2019/03/10/Orkney-Energy-Islands-Penalised Too-Clean-Too-Soon. [24] Watts, 57.

[25] Lesley Riddoch, “We need a brand new Scotland that doesn't look like Britain,” The National, 01 May, 2019, https://www.thenational.scot/news/17611705.we-needa-brand-new-scotland-that-doesnt-look-likebritain/.

[26] Robert Pollin, “De-Growth vs a Green New Deal,” New Left Review, 2018:112, 5-25, 10.

[27] Scottish Government, Scottish Budget 2019-2020, 12 December, 2018, https://www.gov.scot/binaries/content/documents/govscot/publications/corporate-report/2018/12/scottish-budget-2019-20/documents/scottish-budget-2019-20/scottish-budget-2019-20/govscot%3Adocument/scottish-budget-2019-20.pdf, 39

[28] CCC, 6

[29] Scottish Futures Trust, Corporate Plan 2019 - 2024, 25 April, 2019, https://www.scottishfuturestrust.org.uk/storage/uploads/corporateplan20192024.pdf.

[30] Mariana Mazzucato & Laurie Macfarlane, A mission-oriented framework for the Scottish National Investment Bank, UCL Institute for Innovation and Public Purpose, Policy Paper, March 2019 (IIPP WP 2019-02). https://www.ucl.ac.uk/bartlett/publicpurpose/wp2019-02.

[31] First Minister, “Programme for Government,” Scottish Government, 04 September, 2018, https://news.gov.scot/speeches-and-briefings/programme-for-government-2.

[32] Friends of the Earth Scotland, “Green New Deal Briefing,” April 2019, https://foe.scot/wp-content/uploads/2019/04/Green-New-Deal-Briefing-Friends-of-the-Earth-Scotland-.pdf.

[33] Andreas Malm, “Fossil Capital: The Rise of Steam Power and the Roots of Global Warming”, (London: Verso, 2016) 380-381. [34] WWF Scotland and Vivid Economics, “A Climate of Possibility", January 2019, https://www.wwf.org.uk/sites/default/files/2019-01/WWF_Report_VIVID_Jan_2019.pdf, 5.

[35] revive.scot, Revive, Common Weal and Lateral North, “Back to Life: Visions of Alternative Futures for Scotland’s Grous Moors", 10 December 2018, https://revive.scot/wp-content/uploads/Back-to-Life.pdf, 3.

[36] Jim Tomlinson & Ewan Gibbs, “Planning the new industrial nation: Scotland 1931to 1979,” Contemporary British History, 201630:4, 584-606.

[37] Alan Little, “Scotland’s Decision,”BBC News, 04 September, 2014, http://www.bbc.co.uk/news/special/2014/newsspec_8699/index.html

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